Spring Festival Promotes Consumption, Textile And Clothing Is Expected To Improve

Near the Spring Festival, the offline channels of the major brands of clothing and home textiles, and self catering and cooperative e-commerce platforms have been opening up promotional activities for the purchase of new year's products. The demand for the purchase of Spring Festival returns and new year's purchases is expected to stimulate the growth of clothing household textile consumption, and has a positive and positive impact on the growth of the industry's consumption. Combined with the December 2018 retail sales data of consumer goods, the overall consumption growth rate and the growth rate of textile and clothing consumption have picked up compared with November. The growth rate of industrial consumption in January 2019 is expected to be further improved.

　　 Institutional Research

Shen Wanhongyuan (4.390,0.00,0.00%) believes that:

It is hoped that consumer policies will help improve the quality of the public and increase the allocation of foreign capital. In the long run, consumption will become the first engine of economic growth and continue to be optimistic about investment opportunities for medium and long term consumer goods. From the perspective of foreign capital allocation, we will further benefit the leading and competitive public leaders.

In the past three years, the industry valuation has been adjusted to the right place, and the leading quality shows the value of investment.

1) from the beginning of 2016 to the end of 2018, the index of textile and clothing industry of shwan declined by 56.8%. The overall valuation of the brand clothing industry has dropped significantly. The average value of the textile industry index is 18.9 times, and the value of a large number of high-quality leading companies is less than 15 times. In the past three years, the overall competitiveness of the industry has changed positively, and the construction of information technology has been gradually in place. The channel adjustment of street shops to shopping centers has matured, and the layout of multi brands has come down one after another.

2) over the past 19 years, a number of policies have been set up to expand the domestic demand market for consumer goods. We are optimistic about the growth of the industry. Valuations with the margin of safety are worth looking forward to, hoping to usher in Davies's double-click market.

From the perspective of dividend yield, the cash flow of textile and garment industry is better. After three years of valuation, the high dividend yield has many stocks. The valuation level of textile and garment sector is at a low level, and the dividend yield is at the forefront. As of January 4, 2019, the overall valuation level of shwan textile and apparel industry was 18.9 times, which was significantly lower than that of the end of 17, and the dividend rate of the textile industry of Shin Wan in the 18 year was 3.53%, ranking fifth in the whole industry, and about 1.5pct higher than the end of 17.

　　 Shen Wan Hongyuan securities investment strategy:

The Spring Festival in January led to a good performance in clothing consumption, but the turning point of the fundamentals still needs to be confirmed. The trend of foreign capital layout is accelerating, and the expected increment in the future is expected to be concentrated in the first half of the year. We will continue to recommend white horse for clothing consumption and high quality market with good market value and good liquidity. Recommended targets: 1) public white horse: Hai Lan home (600398) (9.000,0.03,0.33%), Semir dress (002563) (9.010, -0.04, -0.44%); 2) high growth business: cross border (002640) (10.740, -0.25, -2.27%), Antarctic electricity supplier (002127) (9.480,0.14,1.50%); 3) high-end clothing: Be Meleven (002832) (33.620,0.05,0.15%).

Everbright Securities (9.290, -0.21, -2.21%) thinks:

In the long run, China's apparel industry has a large space for development, and there is still much room for improvement in the per capita consumption level and concentration of the developed countries. In the short and medium term, brand clothing is intertwined by multiple positive and negative factors: 1) the industry readjustment is in line with 17H1 recovery, and the three major effects of the accumulated inventory, the terminal price and the channel change have been gradually digested and alleviated. 2) under the downward pressure of the economy, the overall retail sales have been weakening since 18Q2, which affected the demand for brand clothing and the slope of the industry's recovery process. Since then, the growth rate of industry revenue has continued to slow down since 18Q2. 3) 17Q4~18Q1 cold winter + late spring festival brings a one-time high base, 18Q4 late winter is not conducive to winter sales.

From the perspective of industry concentration, China is at a relatively low level compared with developed countries. From the industry concentration CR5, the concentration of other categories except sportswear was significantly lower than that of the United States and Japan, of which underwear and women's clothing were the biggest difference. China's underwear CR5 was 7.1% (for the United States, Japan's 1/8, 1/9), and the women's wear CR5 was 6.3% (for the United States, Japan's 1/3, 1/6). The concentration of other products is also lower than that of foreign countries. Although sports apparel has a high degree of concentration, the international strong brands, ADI and Nike, occupy the top two leading positions and share a total of 40.9%. The local brand Anta occupies third and occupies 8% share. Other local brands 360 degrees and XTEP share occupy 4% or 3.8% market share. Compared with the international leading brands and local brands in China, the market concentration is low, and there is room for increasing share.

Judging from the share of the leading companies, the market share of the leading companies in China is obviously lower than that of foreign countries. For example, balbala, the leading Semir clothing in China, occupies 5% share, compared with 11.7% of the leading Carter 's in the United States and 8.5% in Japan's leading Shimamura.

Since 2018, China's macroeconomic downward pressure has increased, 18Q3GDP growth slowed to 6.5%, the lowest level since the 09 financial crisis. Clothing, as one of the consumer categories, will also be affected by the macroeconomic and retail boom. However, from the perspective of recent national policies, the central economic work conference held in December 2018 put forward further tax reduction and tariff reduction. Residents' consumption frequency, total volume and consumption structure are expected to be stimulated, and the consumption structure may change more obviously. In 2018, the state raised the threshold of personal tax, adjusted import tariffs several times in recent years, and released the adjustment of cross-border import electricity retail policy in November 2018, which showed that the policy side encouraged residents to increase total consumption / frequency and unit price and promote quality consumption.

Everbright Securities Investment Strategy:

Defensive varieties (Hai Lan home, Jiumu Wang (601566) (12.810, -0.14, -1.08%), di Su fashion (603587) (22.440, -0.10, -0.44%) and so on; in the medium term, drawing on the experience of the United States, it is recommended to pay attention to the leading section of the high prosperity track (children's clothing, Semir sportswear, Anta sports, etc.), the leading position of cost-effective positioning (Hai Lan home, Semir dress, Taiping bird (603877) (16.680, -0.67, -3.86%), Antarctica business, open run shares (300577) (30.790,0.12,0.39%), etc., as well as the excellent and long-term development strategy of high-end clothing, which is clear and clear. Appropriate allocation of undervalued and high dividend yield

Statement: This article belongs to the professional personal view and analysis of related events. It is not a formal news report. Sina does not guarantee its authenticity and objectivity.